Amendment and Joinder to Stock Pledge Agreement among Balanced Care Corporation, Subsidiaries, and Secured Parties

Summary

This agreement amends the original Stock Pledge Agreement dated April 18, 2000, between Balanced Care Corporation (BCC), its wholly-owned subsidiaries, and several investment entities. BCC and its subsidiaries pledge their equity interests as collateral for a $6.5 million loan provided by HR, RH, and VXM Investments Limited. The amendment adds HR, RH, and VXM as secured parties and clarifies their rights. The agreement remains in effect until all obligations are fully paid, at which point the pledged interests will be released.

EX-10.2 3 w42506ex10-2.txt AMENDMENT AND JOINDER TO STOCK PLEDGE AGREEMENT 1 Exhibit 10.2 AMENDMENT AND JOINDER TO STOCK PLEDGE AGREEMENT This Amendment and Joinder Agreement (the "Amendment") to that certain the Stock Pledge Agreement (the "Stock Pledge Agreement") entered into as of April 18, 2000 by and among Balanced Care Corporation, a Delaware corporation ("BCC"), the other parties listed in Schedule "1" attached hereto, all of which are Delaware corporations and are wholly-owned subsidiaries of BCC (collectively referred to herein as "Subsidiaries", and together with BCC, collectively the "Pledgor"), the parties listed on Schedule "2" attached hereto, all of which are Delaware corporations (individually, a "Company" and collectively, the "Companies"), FRR Investments Limited, a Cayman Islands corporation ("FRR"), and IPC Advisors S.A.R.L., a Luxembourg corporation ("IPC"), is entered into as of this 6th day of November, 2000 by and among the Pledgor, the Companies, FRR, IPC, HR Investments Limited, a Cayman Islands corporation ("HR"), RH Investments Limited, a Cayman Islands corporation ("RH") and VXM Investments Limited, a Cayman Islands corporation ("VXM") (FRR, IPC, HR, RH and VXM are collectively referred to as the "Secured Party"). WITNESSETH: WHEREAS BCC is issuing certain Promissory Notes (the "Promissory Notes") dated November 6, 2000 in favour of HR, RH and VXM in the original principal amounts of $2,166,666.67, $2,166,666.67 and $2,166,666.66 respectively, evidencing an aggregate loan (the "Loan") to BCC by HR, RH and VXM of $6,500,000, the proceeds of which have been advanced to BCC; AND WHEREAS Pledgor, being all of the shareholders of the Companies, have received a direct benefit from the consummation of the transactions evidenced by the Promissory Notes; AND WHEREAS it is a condition precedent to the willingness of the Secured Party to provide the Loan that Pledgor execute and deliver this Amendment in favour of the Secured Party; NOW THEREFORE, the parties hereby agree as follows: 1. Incorporation of Recitals; Definitions. 2 - 2 - The recitals set forth above are incorporated herein by reference and are made a part hereof to the same extent as if such recitals were set forth herein. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Stock Pledge Agreement. 2. Equity Pledge. Section 1 of the Stock Pledge Agreement is hereby amended and restated in its entirety as follows: "Pledgor hereby pledges, grants a security interest in, mortgages, assigns, transfers, delivers, sets over and confirms unto Secured Party, its successors and assigns, all of Pledgor's right, title and interest in and to all Equity Interests owned by Pledgor (collectively, the "Pledged Interests"), and delivers to FRR, as agent for itself, IPC, HR Investments Limited ("HR"), RH Investments Limited ("RH") and VXM Investments Limited ("VXM"), the certificates representing or evidencing the Pledged Interests on the date hereof, which certificates are listed on Schedule 3 attached hereto (collectively, the "Certificates"), with equity powers attached duly endorsed in blank by each Pledgor, receipt of which is acknowledged by FRR, as agent for itself, IPC, HR, RH and VXM, as security for: (a) Pledgor's complete payment and performance of Pledgor's obligations under the promissory notes dated November 6, 2000 in favour of HR, RH and VXM, respectively, in the original principal amounts of $2,166,666.67, $2,166,666.67 and $2,166,666.66 and the Indemnification Agreement and, (b) all other past, present and future obligations of Pledgor to any Secured Party which the Secured Party makes subject to this Agreement in its sole discretion (collectively, the "Secured Obligations"). Upon the payment and satisfaction in full of the Secured Obligations, this Agreement and the security interests granted hereby in the Pledged Interests shall be released (with FRR, as agent for itself, IPC, HR, RH and VXM returning all certificates evidencing Pledged Interests and the Secured Party taking such other action as Pledgor may reasonably request to release the security interests granted hereby)." 3. Joinder. By executing and delivering this Amendment, each of HR, RH and VXM hereby becomes a party to the Stock Pledge 3 - 3 - Agreement, as amended hereby, and each party hereto acknowledges and agrees that each of HR, RH and VXM shall be considered for all purposes of the Stock Pledge Agreement to be a Secured Party and shall be entitled to the rights and privileges of the Secured Party and that each of HR, RH and VXM is bound by all of the provisions of the Stock Pledge Agreement, as amended, hereby applicable to the Secured Party thereunder. 4. Miscellaneous. (a) Wherever it is stated in the Stock Pledge Agreement that FRR acts as agent for itself and IPC, this phrase is amended to read as follows: "FRR, as agent for itself, IPC, HR, RH and VXM". (b) Except as expressly amended or modified by this Amendment, the terms and condition of the Stock Pledge Agreement shall remain in full force and effect. (c) This Amendment may be executed in one or more counterparts, each of which shall constitute an original but all of which shall constitute one and the same instrument. (d) This Amendment may be amended only by a writing signed by all of the parties hereto. IN WITNESS WHEREOF, Pledgor, each Company and Secured Party have caused this Amendment to be duly executed and delivered under hand and seal, all as of the day and year first above written. 4 - 4 - PLEDGOR: BALANCED CARE CORPORATION By: /s/Robin L. Barber Name: Robin L. Barber Title: Senior Vice President and Legal Counsel BALANCED CARE REALTY I, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY II, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY III, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY IV, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 5 - 5 - BALANCED CARE REALTY V, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY VI, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY VII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY VIII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY IX, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 6 - 6 - BALANCED CARE REALTY X, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XI, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XIII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XIV, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 7 - 7 - BALANCED CARE REALTY XV, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XVI, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XVII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XVIII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XIX, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 8 - 8 - BALANCED CARE REALTY XX, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXI, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXIII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXIV, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 9 - 9 - BALANCED CARE REALTY XXV, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXVI, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXVII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXVIII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXIX, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 10 - 10 - BALANCED CARE REALTY XXX, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXXI, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXXII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXXIII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXXIV, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 11 - 11 - BALANCED CARE REALTY XXXV, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXXVI, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXXVII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY XXXVIII, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 12 - 12 - BALANCED CARE REALTY XXXIX, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary COMPANIES: BALANCED CARE REALTY AT ALTOONA, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY AT BERWICK, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY AT LEWISTOWN, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 13 - 13 - BALANCED CARE REALTY AT MANSFIELD, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY AT MARTINSBURG, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY AT MAUMELLE, INC. By: /s/Robin L. Barber Name: Title: BALANCED CARE REALTY AT MOUNTAIN HOME, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 14 - 14 - BALANCED CARE REALTY AT PECKVILLE, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY AT READING, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY AT SCRANTON, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY AT SHERWOOD, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary BALANCED CARE REALTY AT STATE COLLEGE, INC. By: /s/Robin L. Barber Name: Robin L. Barber Title: Vice President and Secretary 15 - 15 - SECURED PARTY: FRR INVESTMENTS LIMITED By: /s/J.B. Unsworth Name: J.B. Unsworth Title: Director IPC ADVISORS S.A.R.L. By: /s/J.B. Unsworth Name: J.B. Unsworth Title: Manager HR INVESTMENTS LIMITED By: /s/J.B. Unsworth Name: J.B. Unsworth Title: Director RH INVESTMENTS LIMITED By: /s/J.B. Unsworth Name: J.B. Unsworth Title: Director VXM INVESTMENTS LIMITED By: /s/J.B. Unsworth Name: J.B. Unsworth Title: Director 16 - 16 - The undersigned, Heller Healthcare Finance, Inc., hereby consents to the foregoing Amendment. HELLER HEALTHCARE FINANCE, INC. By: /s/David G. Moore Name: David G. Moore Title: SVP 17 SCHEDULE 1 SUBSIDIARIES 1. Balanced Care Realty I, Inc. 2. Balanced Care Realty II, Inc. 3. Balanced Care Realty III, Inc. 4. Balanced Care Realty IV, Inc. 5. Balanced Care Realty V, Inc. 6. Balanced Care Realty VI, Inc. 7. Balanced Care Realty VII, Inc. 8. Balanced Care Realty VIII, Inc. 9. Balanced Care Realty IX, Inc. 10. Balanced Care Realty X, Inc. 11. Balanced Care Realty XI, Inc. 12. Balanced Care Realty XII, Inc. 13. Balanced Care Realty XIII, Inc. 14. Balanced Care Realty XIV, Inc. 15. Balanced Care Realty XV, Inc. 16. Balanced Care Realty XVI, Inc. 17. Balanced Care Realty XVII, Inc. 18. Balanced Care Realty XVIII, Inc. 19. Balanced Care Realty XIX, Inc. 20. Balanced Care Realty XX, Inc. 21. Balanced Care Realty XXI, Inc. 22. Balanced Care Realty XXII, Inc. 23. Balanced Care Realty XXIII, Inc. 24. Balanced Care Realty XXIV, Inc. 25. Balanced Care Realty XXV, Inc. 26. Balanced Care Realty XXVI, Inc. 27. Balanced Care Realty XXVII, Inc. 28. Balanced Care Realty XXVIII, Inc. 29. Balanced Care Realty XXIX, Inc. 30. Balanced Care Realty XXX, Inc. 18 2 31. Balanced Care Realty XXXI, Inc. 32. Balanced Care Realty XXXII, Inc. 33. Balanced Care Realty XXXIII, Inc. 34. Balanced Care Realty XXXIV, Inc. 35. Balanced Care Realty XXXV, Inc. 36. Balanced Care Realty XXXVI, Inc. 37. Balanced Care Realty XXXVII, Inc. 38. Balanced Care Realty XXXVIII, Inc. 39. Balanced Care Realty XXXIX, Inc. 19 SCHEDULE 2 COMPANIES 1. Balanced Care Realty at Altoona, Inc. 2. Balanced Care Realty at Berwick, Inc. 3. Balanced Care Realty at Lewistown, Inc. 4. Balanced Care Realty at Mansfield, Inc. 5. Balanced Care Realty at Martinsburg, Inc. 6. Balanced Care Realty at Maumelle, Inc. 7. Balanced Care Realty at Mountain Home, Inc. 8. Balanced Care Realty at Peckville, Inc. 9. Balanced Care Realty at Reading, Inc. 10. Balanced Care Realty at Scranton, Inc. 11. Balanced Care Realty at Sherwood, Inc. 12. Balanced Care Realty at State College, Inc. 20 SCHEDULE 3 CERTIFICATES